Honda’s punitive damages sliced from $500,000 to $100,000

Justice John McIsaac made headlines in March 2005 when he released his decision in Keays v. Honda Canada Inc. He allowed Keays’ claim for wrongful dismissal and awarded him 15 months’ pay in lieu of notice, an additional nine months in Wallace, or bad-faith, damages and a whopping $500,000 in punitive damages. Later, he ordered Honda to pay legal costs of more than $600,000. The decision to award half a million dollars in punitive damages threatened to drastically change the employment law landscape; the view of the Court of Appeal was anxiously awaited.

By Stuart Rudner

10/25/2006|Canadian Employment Law Today

At long last, the Court of Appeal has spoken, and they have done what most employment lawyers expected: they affirmed that punitive damages were appropriate, but drastically reduced the amount.

Kevin Keays worked at the Honda Plant in Alliston, Ont., for 14 years. He suffered from chronic fatigue syndrome and missed work frequently. He was off work entirely, on disability benefits, from October 1996 to December 1998.

According to Justice John McIsaac, the insurer wrongfully terminated his disability benefits and determined he was able to return to work. Without another viable option, Keays returned but continued to suffer. He experienced bouts of drowsiness, fell asleep in his office and missed days from work. Despite glowing work reviews, he continually received poor reviews for his attendance.